GABA & NOVA Independent Contracting - It's Not Just A Japan Thing

"Independent Contracting" at Gaba and Nova is putting the working conditions of all English teachers, both those in the eikaiwa and university sectors, in danger. In private talks , some of the larger language school chains have complained that Gaba effectively saves 30% on labor costs by falsely categorizing instructors as independent contractors and denying them paid annual leave, unemployment insurance, and other benefits. This strategy has had a ripple effect, with one Kansai university claiming its teachers are independent contractors.

Independent contracting has become one of the most important means for employers to reduce labor costs and bluntly, unionization, notably in the US, Japan, and Germany. Steven Greenhouse reports the case of FedEx, in the US, in his book, The Big Squeeze (an excerpt on independent contractors, easily searchable online, appeared in New York Times, April 20, 2008).

As Greenhouse observes, FedEx Ground, a truck service, uses the independent contractor arrangement to gain a major cost advantage over rivals like UPS, which treats its workers as regular employees. The workers even pay for their own trucks, as well as social insurance. One worker protested that it was ludicrous to be termed an independent contractor. "We're told what to do, when to do it, how to do it, when to take time off. You have to wear their uniform. You can’t wear your hair certain ways. You have to deliver every single thing they put on the truck."

In addition, FedEx, argues that independent contractors have no right to organize. Kazama Naoki’s 2007 book Koyo Yukai (Employment meltdown) explains how dubious independent contracting arrangements are used to reduce costs, avoid termination laws, and pressure workers to do unpaid overtime (since the self-employed are exempt from overtime laws). There are no official statistics, but estimates of numbers of independent contractors range from 500,000 to two million. Many do physically demanding or hazardous jobs such as dancer or motorbike messenger, so lack of proper employment-related medical coverage is a major problem.

In a Labor Commission ruling in a case against Gaba, the Commission ruled that Gaba instructors are essentially employees. Gaba attempted to appeal the ruling but ultimately dropped the case. The Labor Commission itself deals with Trade Union Law, and not Labor Law, so we have yet to win employee status for teachers.

The General Union’s fight over Nova and GABA subcontracting is part of a larger fight in Japan, and the world, that affects the lives of millions of workers. Keep watching this space for for news of our next steps. We are expecting to have something to announce in the coming months.

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